2008 (4) TMI 674 - SC - Indian Laws

Employment of a probationer can be proposed to be terminated whether during or at the end of the period of probation Held that - The Executive Committee of the Bank had fixed the number of chances to be given to an employee in the confirmation test. If it is enforced against the writ petitioner having regard to her physical position, to appear in the second examination, the provisions thereof, keeping in mind the principle underlying the statutory provisions of Maternity Benefit Act, may not be held to be applicable. She was, thus, entitled to another opportunity to appear at the examination. The Executive Committee or for that matter the appellate authority cannot exercise the power of relaxation in a discriminatory manner. It was expected to act judiciously, assuming that the employer had a discretion in this behalf. Discretion cannot be equated with whims and caprices. We, for the reasons abovementioned, are not in a position to accept the submission of Mr. Mehta that it was for the employer to decide as to how many chances have to be given to each employee and the Bank cannot be deprived of such discretionary jurisdiction, thus need not deal with the question as to whether the insistence of confirmation test is not in accordance with the Regulations. Appeal filed by the Bank is dismissed and that of the writ petitioner is allowed. The writ petitioner shall be reinstated in service forthwith. She, however, may be paid only 50 % of the back wages. This order we are passing keeping in view that her services had been terminated on 9th November, 1990. The writ petitioner is also entitled to costs. Counsel s fee assessed at Rs.50,000/-.

Summary

Issues Involved:
1. Validity of the requirement to pass a confirmation test.
2. Applicability of the doctrine of implied confirmation.
3. Alleged discriminatory treatment in comparison to another employee.

Issue-wise Detailed Analysis:

1. Validity of the Requirement to Pass a Confirmation Test:
The writ petitioner was appointed as a Management Trainee with the condition to pass a confirmation test. Despite multiple attempts, she failed to pass the test. The petitioner argued that the insistence on passing this test was illegal under the Punjab National Bank (Officers) Service Regulations, 1979. The Supreme Court noted that the Regulations did not explicitly provide for a confirmation test, which was only mentioned in the letter of appointment. The Court acknowledged that while typically a statutory regulation would prevail over an executive order, it proceeded on the premise that such a condition could be imposed by the competent authority. However, the Court emphasized that the period of probation is governed by statutory provisions, and the appointing authority must adhere to these. The initial probation period is two years, extendable by one year, making the total probation period three years. The Court concluded that the requirement for a confirmation test, not being part of the statutory regulations, could not be the sole basis for termination.

2. Applicability of the Doctrine of Implied Confirmation:
The petitioner argued that she should be deemed confirmed as her extended probation period had expired. The Court examined several precedents, including the cases of Dharam Singh and Om Prakash Maurya, which established that if an employee continues in service after the maximum probation period without an express order of confirmation, they should be deemed confirmed. Conversely, the case of Municipal Corporation, Raipur vs. Ashok Kumar Misra indicated that mere expiry of the probation period does not automatically lead to deemed confirmation if specific conditions are not met. The Supreme Court held that the legal principles from these cases were consistent and applicable. Given that the probation period had a statutory limit of three years, and the petitioner continued in service beyond this period without express confirmation or termination, she should be deemed confirmed.

3. Alleged Discriminatory Treatment:
The petitioner claimed discriminatory treatment compared to another employee, Indubala, who was given a fourth chance to pass the confirmation test due to her mother's illness. The High Court found merit in this claim and ruled in favor of the petitioner. The Supreme Court noted the factual error in the bank's affidavit and agreed that the writ petitioner's circumstances, including multiple miscarriages and medical advice against travel, warranted similar or more sympathetic consideration. The Court emphasized the importance of fairness and non-arbitrariness in state actions, particularly under Articles 14 and 16 of the Constitution. It concluded that the petitioner's case was stronger than Indubala's and that denying her an additional opportunity was discriminatory.

Conclusion:
The Supreme Court dismissed the bank's appeal and allowed the writ petitioner's appeal, ordering her reinstatement with 50% back wages and costs. The Court underscored that the bank's actions must align with statutory regulations and constitutional principles of equality and fairness.